Sole trader allowable expenses in Ireland, and where they go on Form 11
"What can I claim?" comes up constantly from new sole traders. Revenue's basic test: an expense is deductible if it's incurred wholly and exclusively for the purposes of the trade and isn't capital. Here's how that works in practice, mapped to the 2025 Form 11 lines.
Allowable expenses and their Form 11 line
| Expense | Form 11 (2025) line |
|---|---|
| Stock, materials, goods for resale | 131 Purchases |
| Wages paid to employees | 133 Salaries / Wages |
| Sub-contractors and freelancers you pay | 135 / 136 |
| Accountant, legal and professional fees | 137 Consultancy, Professional fees |
| Business share of fuel, motor insurance, tolls, parking, business travel | 138 Motor, Travel and Subsistence |
| Repairs to equipment or premises (not upgrades) | 139 Repairs / Renewals |
| Rent for business premises | 140 Rental Expenses |
| Specific bad debts written off | 142 Provisions including bad debts |
| Phone, broadband, software subscriptions, website, hosting, advertising, insurance, bank and payment fees, training, stationery, use-of-home share | 143 Other Expenses |
| Laptop, tools, machinery, van, office furniture | Not an expense: capital allowances, line 114 (12.5% a year over 8 years) |
Mixed-use costs: phone, car and home
Many costs are partly personal. You claim the business proportion only. Work it out on a reasonable basis you can explain, and write the method down:
- Phone and broadband: the share of use that's for business, e.g. from a typical month's bill.
- Car: business kilometres as a share of total kilometres, applied to fuel, insurance, tax and servicing. Keep a simple mileage log. Cars bought for the business have their own capital allowance restrictions.
- Working from home: a share of light, heat and broadband, based on the space used for work and how long it's used.
What you can't claim
- Your own drawings, i.e. what you pay yourself (line 146, not an expense).
- Income tax, USC and PRSI on your own profits.
- Client entertainment (add back at line 161).
- Fines and penalties.
- Personal spending, including the personal share of mixed costs.
- Depreciation from your accounts. Claim capital allowances instead.
- Capital purchases as a one-off expense.
Capital items: the 12.5% rule
For equipment that lasts more than a year, you claim wear and tear allowance at 12.5% of cost per year over 8 years. A €2,400 set of tools bought in 2025 gives €300 a year from 2025 to 2032. Keep a list of each asset with its date and cost, because you need it every year until it's fully written off.
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Records to keep
- Receipts and invoices, digital copies are fine. Keep records for six years.
- Bank statements for the business account (a separate account makes this much easier).
- Your method for any business-use percentage.
- A running list of capital items.
VAT: a separate question
Claiming an expense for income tax is different from reclaiming VAT on it. You only reclaim VAT if you're VAT-registered. Registration is required once turnover exceeds, or is likely to exceed, €42,500 for services or €85,000 for goods (2025 thresholds). Older figures like €37,500 still turn up online.
FAQ
What expenses can a sole trader claim in Ireland?
Costs incurred wholly and exclusively for the business: stock and materials, business insurance, accountant fees, software, advertising, business travel, premises rent, repairs, and the business share of phone, broadband, motor and home-office costs. Equipment that lasts is claimed through capital allowances instead.
Can I claim working from home expenses as a sole trader?
You can claim a reasonable business proportion of household costs such as light, heat and broadband, for example based on the share of the home used for work and the hours it's used. Keep a note of how you worked out the proportion.
Can a sole trader claim their own wages?
No. Money you take out of the business for yourself is drawings, not wages. Drawings don't reduce your taxable profit and are recorded on Form 11 line 146.
Is client entertainment an allowable expense in Ireland?
No. Business entertainment is generally not deductible. If it is in your accounts, add it back in the adjustments section (line 161 on the 2025 Form 11).
General information, not tax advice. Based on Revenue guidance and the 2025 Form 11. Revenue's own guidance on expenses and capital allowances takes precedence.
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